10048--12/21/2006--BARNWELL_INDUSTRIES

related topics

{gas, price, oil}

{loan, real, estate}

{regulation, change, law}

{cost, regulation, environmental}

{customer, product, revenue}

{loss, insurance, financial}

{cost, contract, operation}

{stock, price, operating}

{operation, international, foreign}

{condition, economic, financial}

{operation, natural, condition}

{investment, property, distribution}

{personnel, key, retain}

{acquisition, growth, future}

{competitive, industry, competition}

The oil and natural gas industry is highly competitive. Our results of operations and financial condition are dependent on the prices received for our oil and natural gas production. An increase in operating costs or a decline in our production level could have a material adverse effect on our results of operations and financial condition. Our operating results are affected by our ability to market the oil and natural gas that we produce. Our operations are subject to domestic and foreign government regulation and other risks, particularly in the United States and Canada. Compliance with foreign tax and other laws may adversely affect our operations. We are dependent upon future discoveries or acquisitions of oil and gas to maintain our reserves. Actual reserves will vary from reserve estimates. Delays in business operations could adversely affect our distributions. The industry in which we operate exposes us to potential liabilities that may not be covered by insurance. We may incur material costs to comply with or as a result of health, safety, and environmental laws and regulations. We may have difficulty financing our planned capital expenditures, which could have an adverse affect on our business. Unforeseen title defects may result in a loss of entitlement to production and reserves. Changes in tax and other legislation may adversely affect shareholders. Significant competition in the real estate industry could have an adverse effect on our business. A downturn in economic conditions and demand for real estate could adversely affect our business. Our real estate business is primarily concentrated in the state of Hawaii. As a result, our financial results are dependent on the economic growth and health of Hawaii, particularly the island of Hawaii. The occurrence of natural disasters in Hawaii could adversely affect our business. Increases in interest rates could reduce demand for our real estate. Our business is subject to extensive regulation which makes it difficult and expensive for us to conduct our operations. A portion of future percentage of sales payments could be impaired if the developer of the property is unable to negotiate fee simple interests. If we are unable to obtain required land use entitlements at reasonable costs, or at all, our operating results could be adversely affected. Environmental and other regulations may have an adverse effect on our business. We are involved in joint ventures and are subject to risks associated with joint venture partnerships. Demand for water well drilling and/or pump installation is volatile. A decrease in demand for our services would result in a decrease in our revenues. A significant portion of our contract drilling business is dependent on municipalities and a decline in municipal spending could adversely impact our business. Our contract drilling operations face significant competition from companies with greater financial resources. The loss of or damage to key vendor, customer or sub-contractor relationships would adversely affect our operations. The price of our common stock has been volatile and could continue to fluctuate substantially. Failure to retain key personnel could hurt our operations . A small number of shareholders, including our executive officers, own a significant amount of our common stock and have influence over our business regardless of the opposition of other shareholders. We may be required to comply with Section 404 of the Sarbanes-Oxley Act in 2007, which we believe will result in additional expenses and may divert management s attention. Adverse changes in actuarial assumptions used to calculate retirement plan costs due to economic or other factors, or lower returns on plan assets could adversely affect Barnwell s results and financial condition.

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10048--12/21/2006--BARNWELL_INDUSTRIES_INC